Trapp Corporation Uses the Weighted-Average Method in Its Process Costing

question 37

Multiple Choice

Trapp Corporation uses the weighted-average method in its process costing system. The beginning work in process inventory in its Painting Department consisted of 3,000 units that were 70% complete with respect to materials and 60% complete with respect to conversion costs. The cost of the beginning work in process inventory in the department was recorded as $10,000. During the period, 9,000 units were completed and transferred on to the next department. The costs per equivalent unit for the period were $2.00 for material and $3.00 for conversion costs. The cost of units transferred out during the month was:

• A)$39,600
• B)$45,000
• C)$45,400
• D)$35,400

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Definitions:

Overvalued

A term describing a situation in which a security or an asset is trading at a price exceeding its intrinsic value.

Noncontrolling Interest

Noncontrolling interest, also known as minority interest, represents the portion of a subsidiary company’s equity that is not owned by the parent company.

Acquisition Method

An accounting technique used in consolidating the financial statements of a group of companies when one acquires control over the other.

Consolidated Net Assets

The total assets minus total liabilities of a company and its subsidiaries, reported as a single figure in consolidated financial statements.